How Mastercard Is Evolving Payments for the Gig Economy

At the 2018 Collaboration in the Gig Economy conference in Dallas earlier this month, I was struck by the keynote message, delivered by Dr. Vivienne Ming. Her thesis: There’s a lot of fear and buzz about AI taking over the workforce, but we will always need people’s problem-solving skills to supplement those algorithms. And because we’ll always need people, we’ll always need payments.

That’s why we’re excited to play an integral role in ushering in the next era of the gig economy. At Mastercard, we believe it’s time for more sophisticated, tailor-made solution to support this emerging workforce.

Both the challenge and the stakes are right in front of us. The role of payment is critical to the gig economy, and enabling payment is the golden thread that ties it all together.

What Gig Workers Want

At Mastercard we began focusing on the gig economy more than two years ago, talking to hundreds of gig workers around the world and fielding research with thousands more. The results were illuminating.

We heard that the best and worst aspect about gig work is the flexibility. Nobody gives you any structure, workers tell us, so you have to create that on your own — not always the easiest task under old payment paradigms.

Our research clearly shows that the inefficiency of payments is one of the most prevalent obstacles keeping independent workers from fully realizing the flexibility and independence that attracts many people to gig work in the first place.
Here is what they want:

  • Visibility into their gig. Mastercard research shows that today, 90 percent of gig workers use their personal payment product for business purposes, mixing their personal and professional expenses. This generates confusion about inflows and outflows and a poor understand of the gig’s profitability.
  • Fast payments. Only a small percentage of gig platforms have fast payment capabilities, but when they offer it, gig workers love it. Fifty-seven percent of Uber and Lyft drivers use instant or express pay apps to get paid out instantly; 36 percent use it at least three times a week.
  • Benefits. Gig workers do not have the same benefits full time employees have, and they feel the pain. 76 percent of gig workers would value merchant offers linked to their card, considering this a necessary feature of their payment solution.

A Global Gig Payment Solution

The Mastercard Gig Payment Solution was co-created with gig workers to address their specific needs. We applied design thinking and a user-centric development process to build an end-to-end solution that answers both gig platforms’ and gig workers’ needs.

This payment solution resonates with the key insights of our research. We built the value proposition around the three pillars of visibility, fast payments and benefits.

The new prepaid card for gig workers give them a better visibility into their gigs, allowing them to separate their gig from their personal life; also, the solution enables gig workers to request an instant payment from the platform as soon as the buyer has made payment. It gives access to benefits such as discounts and rebates at over 40,000 relevant merchants and device insurance.

We are working with many partners all around the world to seize the opportunity to serve gig workers with a new and more effective payment solution, through new product launches, partnerships and more.

The gig economy is thriving and here to stay. The time for intelligent payment solutions to support this revolution is upon us.

This post is sponsored by Mastercard.